How Channel 4 make the numbers stack up without advertising during F1 races

The big F1 news of the week was Channel 4 sneaking up on the blindside and stealing the Formula One contract for UK free to air TV from ITV for the next three years. The Independent Television Network previously aired F1 in Britain until they chose to instead spend their sports budget on Champions League Football from 2009 onwards.

ITV irritated F1 fans when they last broadcast Formula One by cutting to adverts during the race and this was something Bernie Ecclestone was keen to avoid. Losing the ‘no adverts’ BBC to a broadcaster who failed to provide uninterrupted on track race action would have been a political blow to the F1 supremo.

It is for this reason that Channel 4 trumped ITV and now becomes the free to air F1 broadcaster in the UK. Yet ITV executives have been left scratching their heads on how Formula One can be delivered economically without advertisement breaks during races.

To justify the broadcasting a sport, a commercial station ITV must demonstrate the airtime delivers a proper contribution to overall profit and so would be forced to break F1 races up with advertisements. Channel 4’s advantage is they merely need to break even on F1.

Former Channel 5 CEO David Elstein believes Channel 4 can make the numbers stack up because, “the sponsorship rights alone are valuable Probably almost half the rights cost could be retrieved from sponsorship, and the balance from enhanced commercial impacts in the key demographics of young males.”

Elstein adds, that incremental revenue can be driven for Channel 4 because on “non-live coverage on race days can be stuffed with ads”. This simply means the lost minutes of advertising during live races could be added back during the race highlights coverage.

Channel 4 are believed to be contributing £20m a year to the Ecclestone coffers in broadcasting rights, with the BBC making up the other £10m. The state owned Channel 4 says it is building on its “track record for innovation in sports broadcasting” by dropping the ads that spoil the Formula One viewing experience. Given their innovation in technology for the cricket broadcasting, we may well see, for example, more side by side double screen reviews and even ghost car images from a studio based “analyst”.

In a complete reverse of the recent BBC dumbed down F1 coverage, Channel 4 may well compliment their race broadcasts with more in depth programming which delves into the technical depths of Formula One. Specialist documentary programming is after all a strength of the network.

The decision on presenters will be fascinating. Suzi Perry, for many is a lame duck, and her struggles with the live in ear instructions are evident from race to race. Jennie Gow is at home in the controlled environment of the Formula E studio. However, her pit lane contributions during BBC’s F1 radio broadcasts are often confused. Lee McKenzie is prized by the BBC and like will at least be again in the frontline at Wimbledon and the Olympics. McKenzie could become another Claire Balding at the BBC, deployed to a variety of sports and more than competent to add expert opinion in each situation.

With any luck, Eddie Jordan is now gone from our screens.

To balance the books, the new free to air F1 UK channel may use “picture in picture” ads similar to those it airs during the horse racing coverage it provides.

Broadcasting insiders believe the move by Channel 4 to offer free to air F1 in the UK is designed to ward off any proposals they should be privatised. By delivering advert free F1 races, they justify their status as a non-for profit broadcaster.

A Channel 4 spokesman says: “We’ve done the due diligence and necessary sums on this and we’re comfortable it’s commercially viable. It will add to our overall [viewing] share when we are going to do deals [with media agencies]. It will support our schedules and draw people in, particularly a very upmarket, young and male audience.

Channel 4 may also have a much more relaxed approach to sharing their unique F1 content (interviews etc) across a number of media platforms. For sure, it is interesting times.

I’m really looking forward to C4’s coverage. They have previous re motorsport – their WRC programme was pretty good, I’ve often thought that their ‘ghost car’ comparisons would translate well to F1, esp to compare differing racing lines between drivers. And it would be great to have more documentaries exploring the technical and engineering sides of the sport in greater depth – that alone would do a lot to ensure the long term health of F1, inspiring young eyes and minds to explore careers in the sciences.

I’m not sure if C4’s advertising/programme ratio is covered by any legislation – it certainly doesn’t look like it – but they’re bound to crank the irritation up to ridiculous levels to compensate for sewage-time lost during the races. Which would, I hope, ensure that anyone with even half a brain will either record the transmissions and watch later, speeding through the garbage, or else avoid the pre- and post- show waffling which bookends live races, irrespective of who it is that’s doing the waffling.